Price to Book

What is Price to Book Ratio?

The Price to Book Ratio is calculated by dividing the current market share price by the book value per share of the company.

Formula:
Price to Book Ratio = Price per share / Book Value per Share

What does Price to Book Ratio mean?

The Price to Book Ratio shows how the market values the company compared to its book value. Book value represents the value of the company’s assets if it were liquidated today. A lower Price to Book Ratio may indicate that a company is undervalued, as it is trading for less